Call for Shropshire Council's £28 million reserves to help plug funding gap

Shropshire Councillor Hannah Fraser, who represents the Abbey ward in Shrewsbury, has been part of a 'task and finish' group scrutinising the authority's financial strategy.

One of the queries raised by the group is whether the authority needs to retain £28 million in reserves. The group's work has also uncovered concerns that £4.2 million of cuts to preventative services in adult social care will actually lead to greater costs.

Councillor Fraser said that the council had put the £28 million aside to deal with unforeseen circumstances.

She said it is likely that the group will recommend that the level should be set at about £18 million, freeing up £10 million to help tackle the council's current financial problems.

She said: "Personally I think all this stuff is there for a rainy day and if you look out of the window it is raining.

"We need to maintain a prudent level of reserves but not more than that. It should be reviewed to provide money to help fill one off gaps in the budget and we should then look to replenish it in future years."

A report from the committee will be considered by Shropshire Council's cabinet on July 27. An interim report on the strategy also outlines the committee's concerns that cuts to preventative services provided by voluntary groups would lead to increased costs in the longer term.

Preventative services are those designed to make sure that elderly or vulnerable people do not have to go into hospital. The saving, of £4.2 million, is rated as "red" in the council's financial strategy. Red savings are those which are considered a risk, because they cannot be delivered or will not work.

The report states: "There is a £4.2 million red rated saving in the financial strategy relating to preventative services which are provided by external agencies such as the voluntary and community sector. The task and finish group heard that losing preventative services would have an impact through increased demand and cost on adult social care, and on health. The adult social care operating model is focused on maximising independence through local early intervention, and this would not be able to function as planned if the local services are not available."

The group said it would carry out more work to assess how prevention work can be paid for.